Tech

Netflix should buy a TV maker to get a leg up in the streaming wars, consumer expert argues

Key Points
  • Netflix or possibly even Apple should consider buying a TV manufacturer as the streaming wars heat up, consumer marketing expert Matt Britton argues. 
  • "I think whoever controls that last-mile distribution is going to win, so I'm surprised that a defunct or an about to go out of business company that makes TV consoles hasn't been approached by one of these content companies," the Suzy CEO says. 
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As the streaming wars heat up and competitors look for advantages, Netflix and Apple should consider buying a TV manufacturer, consumer marketing expert Matt Britton told CNBC on Friday.

"I think one largely missed element of this is the television itself," Britton, CEO of consumer intelligence company Suzy, said on "Closing Bell." "If I were a large company like Netflix or even Apple, I would buy a company that makes TV consoles and give them to high-income consumers for free."

The reason, Britton argued, is that pieces of hardware like TVs are the "last mile for content."

"We see that with the iPhone," Britton said. "I think whoever controls that last-mile distribution is going to win, so I'm surprised that a defunct or an about-to-go-out-of-business company that makes TV consoles hasn't been approached by one of these content companies."

The streaming landscape has grown increasingly crowded, bringing added competition to established players like Netflix, Hulu and HBO.

Disney, AT&T's WarnerMedia and Comcast-owned NBCUniversal are soon launching services of their own. Apple TV+ will launch Nov. 1, and Disney's service will launch two weeks after that.

Britton's comments Friday follow news that Disney is banning ads from competitor Netflix on all of its TV platforms except for ESPN.

Britton said he didn't think that would be a major setback for Netflix's business, outside of the Oscars "where they can't run ads."

"But besides that, there's plenty of other places for them to capture customers," he said.

At the same time, Britton said Netflix faces other headwinds. Yes, Netflix has great content, Britton said, but that is accomplished mainly through "writing checks."

But "companies like Apple and Amazon have deeper checkbooks, and they have a thriving direct-to-consumer base," Britton said.

Britton said Apple has a strong ecosystem in the home, with iTunes and Apple TV, "which I think is incredibly powerful." Amazon also has a strong existing presence through Prime, Britton said.

"For consumers, you get free shipping on your Amazon products and you can pay for the subscription, where Netflix you just get the content," Britton said. "So that's why I think it's really hard for them to compete because they were first to market, but as these competitors come in, I think it's going to be hard for them to hold their ground."

Netflix could gain stronger footing by controlling a piece of hardware that helps distribute its content, Britton argued.

"I think you need the whole stack, so to speak," he said.

Disclosure: Comcast is the owner of NBCUniversal, parent company of CNBC and CNBC.com.